By E. Roberts Musser, filling in for David M. Greenwald –
At the unusually early hour of 9:30 a.m. on August 2, 2010, the City Council considered a City Staff proposal to provide financial assistance for relocating a VW auto dealership from Napa to a vacated/blighted parcel within the redevelopment project area of the city. The parcel in question is located at the former Ford dealership site in south Davis on Chiles Road. It is currently being underutilized for an auto repair shop. The proposed City Staff resolution authorizes the Redevelopment Agency to execute an Owner-Participation Agreement with Hanlees Partners (who already own several auto dealerships in Davis), to allocate up to one million dollars from the Redevelopment-Commercial Development funds (funding Davis receives from the federal gov’t) as a loan.
According to City Staff, discussions with Don Lee of Hanlees indicated it would cost approximately $2 million dollars to demolish the existing building, erect a new state-of-the-art showroom, remodel the service building and improve the site. A consultant, Economic and Planning Systems (EPS), was hired by the city to do a fiscal analysis of the project and Hanlees’ need for city financing. Prior to this, upgrades of such a nature have been done without the city’s fiscal assistance. However, because of the recent downturn in the economy, it has become virtually impossible for dealerships to obtain suitable financing on their own at reasonable rates, said City Staff.